Long-term STP funding swallowed up ‘just keeping the show on the road’

Funding that was put aside to stabilise NHS finances and support sustainability and transformation partnerships (STPs) has instead been spent on helping the service cope with immediate pressures and day-to-day costs, the government’s financial regulator has today reported.

In a review of STP funding in England, the National Audit Office (NAO) also warned that these quick fixes may become commonplace in the NHS in the future.

A £1.8bn sustainability and transformation fund was announced in 2016-17 to give the NHS “breathing space,” and the NAO conceded that this extra cash had seen combined trust deficit reduced to £791m in 2016-17 from a staggering £2.4bn in 2015-16.

However, though there was an improved underspend of £154m across CCGs, 62 commissioning groups reported a cumulative deficit in 2016-17, almost doubling from 32 in 2015-16.

On top of this, though the NHS’s overall financial position improved last year, the auditor stated that the health service was struggling to manage its activity and demand within budgets, and had not met access targets.

A lack of funds also means that there is very little cash for long-term transformation to meet demand and improve services – last year, £1.2bn of the NHS’s £5.8bn budget for capital projects was used to pay for day-to-day activities.

CCGs and trusts increasingly reliant on ‘one-off measures’

The report also stated that CCGs and trusts “are increasingly reliant on one-off measures to deliver savings,” with many trusts receiving large levels of in-year cash injections – most of which are loans from the Department of Health and Social Care (DHSC). This kind of support shot up from £2.4bn in 2015-16 to £3.1bn in 2016-17.

When it came to the effectiveness of STPs themselves, the NAO argued that though progress had been made on setting up the arrangements, the effectiveness of the partnerships varied, and difficult financial positions made it difficult for them to shift focus from short-term day-to-day pressures to transforming services.

The auditor has also recommended that the DHSC, NHS England and NHS Improvement move further and faster towards aligning nationwide incentives, regulation and processes, as well as reassessing how best to allocate sustainability and transformation funding.

CEO of NHS Confederation Niall Dickson commented that today’s findings added to a “long line of reports lamenting the sate of health and care.”

“We have passed the point in which politicians needed to be honest with the public about what faces us now and what will face us in the future,” he claimed.

Chris Hopson, chief executive of NHS Providers, added: “For the first time ever the health service missed all the main performance targets for treatment in A&E, routine operations, cancer care and ambulance response times.

“Extra funding to facilitate better, more convenient and sustainable ways of providing care for patients was used up just keeping the show on the road.”

Hopson also argued that the NAO was right to highlight the “decidedly mixed picture of progress” that was being made with the development of STPs and accountable care systems.

Head of the NAO, Amyas Morse, stated: “The NHS has received extra funding, but this has mostly been used to cope with current pressures and has not provided the stable platform intended from which to transform services.

“Repeated short-term funding-boosts could turn into the new normal, when the public purse may be better served by a long-term funding settlement that provides a stable platform for sustained improvements.”